According to a lawsuit filed by the Securities and Exchange Commission (SEC), AT&T Inc. T has agreed to pay a $6.25 million penalty for selectively leaking financial information to Wall Street analysts.
Three AT&T executives, Christopher Womack, Kent Evans, and Michael Black, have agreed to each pay a $25,000 penalty. The SEC alleged that these executives were involved in violating Regulation FD and made private calls to analysts at about 20 firms.
“We are committed to following all applicable laws and pleased to have a resolution with the SEC. With this settlement, the company and its employees neither admitted nor denied the SEC’s allegations,” Reuters quoted AT&T saying.
The report states that back in 2021, the SEC accused AT&T and the three investor relations executives of leaking details about its smartphone business to 20 firms.
According to the SEC, the company violated fair disclosure, which the agency adopted a year earlier to bar companies from disclosing material non-public information privately.
Talking about the SEC’s action against AT&T, Dennis Kelleher, the President and chief executive officer of the non-profit watchdog group Better Markets, said, “We applaud the SEC for penalizing the company and three executives for this flagrant illegal conduct.”
“But mere money penalties are too light to stop this widespread corporate practice of market manipulation by selectively disclosing material nonpublic information to handpicked firms, giving them a unique trading advantage to rip off unsuspecting investors,” he added.
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